GRANDVIEW - Monday night, Grandview City Council got its first look at the 2005 budget. Although it's only October, council members are getting ready to pull up their sleeves and get to work on ensuring that the budget is drafted in a way that looks beyond next year, helping to ensure that the city continues to be in fair financial shape in the future.
City Administrator Jim Sewell explained to council that over the years the city has felt the impact of several voter passed initiatives, noting that the city saw an initial reduction of $700,000 a year after those initiatives passed.
"How do we recover that revenue or make up that shortfall," Sewell asked council. He then explained that the city has made up the difference over the years through the additional taxes coming in from the new Wal-Mart distribution center, changes in operation and reductions the city has made over the years. And the city is expecting to make up the rest during the growing period that is currently being experienced. Sewell said new construction, new homes acity make up the rest of the revenue lost due to the passage of those initiatives.
"There's a lag time between any significant event and something that will pull you out of it," Sewell said. "I think that lag time is now."
According to Sewell, the city is looking at having an increase in its operating budget of more than $118,000 for 2005. The total operating expenses for 2005 are estimated at $3.5 million. Sewell explained that the increase will be absorbed by the city through its current expense fund balance. He noted that council recently decided to try and keep the fund balance above $400,000, instead of the $500,000 it had been aiming for in the past.
"[That] will help us through the lag time," Sewell said.
Sewell added that the preliminary budget includes the city continuing to provide services at the same level that is currently offered.
According to the preliminary budget, there are small increases in the operating budgets of several department funds. There is a 3 percent increase estimated in the street fund's operating budget, although Sewell said the level of service is expected to remain the same. Sewell said in the cemetery fund the operating budget is actually a little less than it was in 2004, noting that over the past year the revenue stream at the cemetery hasn't been has high as was expected.
"It could be pretty tight if revenue doesn't increase," Sewell said of the cemetery fund.
The water and sewer fund could see a 6.9 percent increase over last year's budget, bringing its operating budget to $1,972,840. According to Sewell, a rate study is already underway with the engineer expected to talk to council about any necessary rate adjustments in November.
There is an estimated 8 percent increase in the irrigation fund's operating expenses, bringing the total preliminary budget to $241,813 for 2005. Sewell told council this increase comes from the increased cost of irrigation rates.
When it comes to the garbage fund there is also an increase in the operating budget. Sewell explained that the $36,010 increase will cover the cost of the community clean-up program, which the city implemented this year.
The equipment rental fund could see a $23,420 increase in its operating budget for 2005. Sewell said the reason for this increase is the increased cost of fuel. He told council that half of the increase had to do with rising fuel costs.
Grandview City Council will take a closer look at the 2005 budget in the coming weeks. The first budget session when council will begin working with the document is expected to take place Nov. 1.
. Elena Olmstead can be contacted at (509) 837-4500, or e-mail her at firstname.lastname@example.org